RICHMOND, Va., Dec. 12, 2012 /PRNewswire/ -- Dominion Virginia Power welcomed the news today that the U.S. Department of Energy had selected a company-led team to begin award negotiations for initial engineering, design and permitting for an offshore wind turbine demonstration facility off the coast of Virginia.

In its DOE application, Dominion proposed designing, developing, and demonstrating a grid-connected, 12-megawatt offshore wind facility consisting of two Alstom 6-megawatt turbines mounted on innovative foundations. Dominion's primary location for the demonstration project is in federal waters about 22 miles off the coast of Virginia Beach, although the ultimate site will depend on detailed investigations. Twelve megawatts would provide enough electricity for 3,000 homes at peak demand.

"Winds off the coast of Virginia hold great potential for electricity generation," said Mary C. Doswell, senior vice president-Alternative Energy Solutions. "The challenge will be to harness this energy and bring it to our customers at reasonable cost. To achieve that will take a lot of creative engineering to find innovative ways to lower costs, which is the goal of the DOE program. We have the right team in place to begin this work with the goal of being chosen ultimately to build the demonstration facility."

Others on the Dominion team are:

Alstom Power Inc., a wind turbine manufacturer and major supplier of equipment and services to the global power generation market;

KBR, a global engineering, construction, and services firm with experience in offshore wind;

the Commonwealth of Virginia Department of Mines, Minerals and Energy;

the National Renewable Energy Laboratory;

the Virginia Tech Advanced Research Institute, representing the Virginia Coastal Energy Research Consortium;

And Newport News Shipbuilding, a division of Huntington Ingalls Industries.

Dominion and its team is one of seven projects selected today to receive $4 million each in federal matching funds to undertake initial engineering, design, and permitting for a demonstration facility. DOE then will select up to three of the projects for follow-on phases to move forward with the final design, permitting, and ultimate construction of U.S. demonstration projects. Each will receive up to an additional $47 million over four years, subject to Congressional appropriations. The projects must be in operation by the end of 2017. Read the DOE news release at: http://www.doe.gov/articles/energy-department-announces-new-investments-pioneering-us-offshore-wind-projects

In March, Dominion told the Bureau of Ocean Energy Management (BOEM) that it is interested in obtaining leases off the Virginia coast in an area that has the potential to generate approximately 1,500-2,000 megawatts of electricity from offshore wind turbines, or enough electricity for 500,000 homes at peak demand. In November, BOEM announced that it would place about 113,000 acres off the Virginia coast up for auction as a single lease next year.

Dominion (NYSE: D) is one of the nation's largest producers and transporters of energy, with a portfolio of approximately 27,400 megawatts of generation, 11,000 miles of natural gas transmission, gathering and storage pipeline and 6,300 miles of electric transmission lines. Dominion operates one of the nation's largest natural gas storage systems with 947 billion cubic feet of storage capacity and serves retail energy customers in 15 states. For more information about Dominion, visit the company's website at www.dom.com.